Why do we have to pay service taxes when paying a bill in high class restaurants and not in local restaurants in India?

Well you pointed out rightly. It is such a big non sense to charge service tax on food also. But we can't do nothing in front of law. Law says serving food in restaurant having AC in any part than on 40% part service tax would be levy & on remaining 60% part VAT would be levy. Well this is to inform you that recently 2-3 months ago KERELA HIGH COURT decided in one of case law that central govt. Has no right to collect tax on food items as per constitution, only state govt. Can collect hence it is INVALID to enter such a taxation. I don't know what would happen after this. Why CBDT has not clarify the issue yet. Well some restaurant(PIZZA HUT) as a TAX PLANNING use composition rate I.E. 5% VAT So that less burden falls in pocket of consumers. but I did not agree with the point that when you purchase pizza as a TAKE AWAY order than there is no sense of levying service tax on it bcz consumer has not use any of the service of restaurant . he will enjoy his pizza at home so if no service than no service tax.